Understanding The Benefits Of Bankruptcy.

Many people are afraid of bankruptcy. The very word sends shivers down their spine. It’s the financial world’s scarlet “a”. That’s a general misconception held by many. Filing for bankruptcy is often times a beneficial experience when one is saddled with insurmountable death. People worry about it showing up on their credit report--and it will, but it is still better than nothing. Bankruptcy, with all of it’s taboo, is in fact doing something.




Having good credit after bankruptcy is possible, you could even obtain a good credit score within several years of your bankruptcy case being discharged. The first step is receiving the notification from the courts that all of your debt has been discharged. This form will be titled “Discharge of Debtor.” Keep this form in a safe place because you may need to show this to creditors as proof your debts are gone.




Review your credit reports and score closely and clear up any errors. Request your credit report from each of the three major credit agencies. Make sure that all of your debts are listed as “discharged.” and contact your Bankruptcy Attorney Gregory J. Wald.










Gregory J. Wald, Attorney at Law

1500 Northland Plaza

3800 American Boulevard West

Bloomington, MN 55431

Telephone: 952-921-5802

Toll Free: 1-866-747-1130

Fax: 952-831-1346

BankruptcyMinn.com



Gwald314@msn.com

What’s the difference between Chapter 7, 11 and 13 of the Bankruptcy Code?

...A commonly asked question. Commonly asked because many are truly unaware of the differences between the two.


Chapter 7.



Chapter 7 case begins with the debtor filing a petition with the bankruptcy court serving the area where the individual lives or where the business debtor is organized or has its principal place of business or principal assets.




Chapter 13


Chapter 13 issues a payment plan to repay some debts, with the rest of the permitted debts being discharged. Keep in mind, not all tax debts are able to be discharged in bankruptcy, but taxes that are eligible to be discharged in a Chapter 7 are also eligible for discharge in Chapter 13. When you file for bankruptcy, your tax debts must meet a certain standard in order to be discharged.




If you file for Chapter 13 bankruptcy, money owed to the IRS that does not meet the qualifications to be discharged can be repaid through a payment plan that lasts anywhere between three and five years without penalties or continuing interest. (Although in some cases interest and penalties must be paid if there is a tax lien).




One of the benefits of filing a Chapter 13 bankruptcy is if the IRS rejected your previous payment plan, this is a way to get them to accept one.


Chapter 11


Debtors should be aware that there are several alternatives to chapter 7 and 13 relief. For example, debtors who are engaged in business, including corporations, partnerships, and sole proprietorships, may prefer to remain in business and avoid liquidation. Such debtors should consider filing a petition under chapter 11 of the Bankruptcy Code. Under chapter 11, the debtor may seek an adjustment of debts, either by reducing the debt or by extending the time for repayment, or may seek a more comprehensive reorganization. Sole proprietorships may also be eligible for relief under chapter 13 of the Bankruptcy Code.




It is recommended that you speak with your attorney regarding this matter before deciding between filing Chapter 7 or Chapter 13 to get rid of or aid with the burden of tax debt.




Gregory J. Wald, Attorney at Law

1500 Northland Plaza

3800 American Boulevard West

Bloomington, MN 55431

Telephone: 952-921-5802

Toll Free: 1-866-747-1130

Fax: 952-831-1346

BankruptcyMinn.com

Gwald314@msn.com